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May 5th - According to three sources familiar with the matter, US intelligence assessments indicate that the timeline for Iran to develop nuclear weapons has remained unchanged since last summer. At that time, analysts estimated that the joint US-Israeli strikes had delayed this timeline by up to a year. This unchanged timeline suggests that effectively stopping Irans nuclear program may require the destruction or removal of Irans remaining stockpile of highly enriched uranium (HEU). The sources stated that US intelligence agencies concluded before the 12-day war in June of last year that Iran was likely to produce enough weapons-grade uranium to build a nuclear weapon within three to six months. Following the June airstrikes, US intelligence assessments pushed this timeline back to approximately nine months to a year.According to the Wall Street Journal, "Big Short" Michael Burry has sold off his entire stake in GameStop (GME.N), after GameStop announced its intention to acquire eBay (EBAY.O).Bank of Canada Governor Macklem: With Federal Reserve Chairman nominee Warsh now serving as Chairman of the Federal Reserve, I believe the Feds culture and behavior will continue as they have been.US President Trump: Hundreds of millions of barrels of oil are flowing out of Venezuela.On May 5th, New York Federal Reserve President Williams stated that the Feds current accommodative stance reflects the likely long-term direction of monetary policy, while inflation dynamics have not yet reached the point where a rate hike needs to be discussed. Speaking to reporters after a speech in New York City, Williams said, "I dont see any indication from todays data that a rate hike is necessary in the near term." However, he added that given the current level of uncertainty, he believes "we cannot yet provide clear guidance on the direction of interest rates at the next few meetings."

NZD/USD falls toward 0.6100 as Vice President Joe Biden aims to raise taxes on the rich and China's CPI is in focus

Daniel Rogers

Mar 09, 2023 14:01

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The NZD/USD pair was unable to recapture the crucial resistance level of 0.6120 during the Asian session. The New Zealand dollar is falling toward the round-number support of 0.6100 as the news that US President Joe Biden has proposed increasing the corporate tax rate from 21% to 28% has bolstered bearish market sentiment.

 

US Vice President Joseph Biden proposes a 25% tax on billionaires and steep levies on affluent investors. He has also proposed a 39.6% tax on incomes over $400,000 in the budget. The United States' fiscal policy appears to be kicking in to prevent the Consumer Price Index (CPI) from flexing its muscles further. By diminishing market liquidity, higher taxes may have a significant effect on consumer spending.

 

As a consequence of the news that wealthy Americans will be taxed more heavily, the S&P 500 futures are also under duress. The futures for the 500 largest U.S. stocks are falling during the Asian session. It appears that market participants will use Wednesday's insignificant recovery move as a selling opportunity.

 

In response to Vice President Biden's proposal for higher tariffs, the US Dollar Index (DXY) may experience some upward movement. The USD Index is presently hovering above 105.20 and is anticipated to resume its upward trend.

 

This week, the US Nonfarm Payrolls (NFP) data will remain in the spotlight. According to the consensus, the US economy added 203K new employment in February, which is less than the previous record-breaking release of 517K. The unemployment rate is anticipated to remain unchanged at 3.4%. Investors are concerned about the Average Hourly Earnings data, which is expected to increase to 4.8% on an annual basis from the previous release of 4.4%. An increase in the labor cost index will increase the likelihood of the Federal Reserve raising interest rates more significantly (Fed).

 

Investors are keeping an eye on China's Consumer Price Index (CPI) data. China's CPI is anticipated to decrease to 1.9% from the previous annual rate of 2.1%. The monthly CPI is expected to decrease to 0.2% from the previous release of 0.8%. If inflation declines, the Chinese government and the People's Bank of China (PBOC) may be forced to infuse more liquidity into the economy.

 

Notably, New Zealand is one of China's primary trading partners, and an increase in liquidity in the Chinese economy will increase demand for the New Zealand Dollar.


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